Guest Blog: Strategic Business Improvement in the New Economy – Part 2

Most organizations are emerging from largest recession and slow recovery since the Great Depression. Unfortunately, the reactionary and inconsistent leadership responses to the meltdown have become the new cultural norm in organizations, taking culture backwards and destroying their ability to improve anything. Organizations have placed a “freeze” on improvement when they need it the most. The majority of organizations currently find themselves in a derailed state with their Lean Six Sigma initiatives, and a solid foundation of strategic and sustainable improvement in general. What is needed is a more accelerated and adaptive approach to improvement to get back on track in the new economy. This post has been created from my new book, Accelerating Lean Six Sigma Results: How to Achieve Improvement Excellence in the New Economy. Read Part 1 of the post here.

Improvement Excellence: Improving How We Improve

The next generation of improvement in the new economy is Improvement Excellence: The mastery of developing and implementing successful strategic and continuous business improvement initiatives, transforming culture, and enabling organizations to “improve how they improve.” This sounds so simple and logical: Take the improvement methodologies already available to us, adapt the process of improvement to changing global requirements, and build a permanent and sustainable capability to continuously improve how we improve. However, Improvement Excellence is a legitimate core competency that is missing in most organizations. The past three decades support this claim and reveal a disturbing birth-death cycle of improvement: When things are good, improvement is the first casualty because it is perceived to be no longer necessary. When things are bad, improvement is the first casualty because people do not have the time and resources to improve and do their regular firefighting jobs. Between these two extremes, improvement has been supported by temporary and wavering commitments, token agreements, follow-the-leader fad programs, massive training, and more going through the motions of improvement. Whether it is a lack of attention, poor visible and sustaining results, conflicts with new issues, downsizing and cost cutting, or plain loss of interest – Improvement always fades away as an expected enabler of business and cultural success.

The Improvement Excellence framework (Figure 1) recognizes this need for dynamic and adaptive strategic improvement, continuously evolving to specific market, customer, and enterprise needs. Strategic improvement is deeply engrained in culture where organizations proactively strive for a desired rate and level of improvement via cost reductions and growth as the major enabler of a desired level of business and financial performance. Improvement Excellence incorporates the following key characteristics:

Sustainable continuous improvement is built into organizational culture via a formal infrastructure. The elements of this infrastructure include Strategic Leadership and Vision, Deployment Planning, and Execution. This formal infrastructure aligns evolving customer and market needs with strategy, improvement, and sustainable results. It also keeps the notion of improving how we improve in the forefront of the typical ongoing changes in executives and leadership directions, conflicting priorities, political motivations, a focus on short term performance, and other potential distractions to strategic improvement. Infrastructure links and closes the loop between individual improvement success and global business success.

The process of improvement is customer-centric, adaptive, and more nimble. Improvement Excellence uses a methodology called Scalable Lean Six Sigma, which is a simplified but high impact alternative to the traditional top down, mandated, overhead intensive, single point, train-the masses approach to improvement. Too often the traditional approaches to improvement produce only symbolic storyboards, boilerplate education, metaphorical “belts,” beautification exercises, and the illusion of improvement with little measurable results. The focus of Scalable Lean Six Sigma is on the efficient process of improvement rather than the naive application of DMAIC or specific tools, and the scope is limited to the 3-5 critical issues that keep everyone up at night vs. mass, non value-added improvement activity for activity sake. Scalable Lean Six Sigma is a strategically targeted and scalable approach, achieving rapid deployment and of course, rapid quantifiable and sustainable results.

Rapid deployment and rapid results are also achieved through the 10 Accelerators embedded within the Improvement Excellence infrastructure (see Figure 1). Collectively, the 10 Accelerators provide an effective means of improving and adapting the overall process of improvement to evolving customer and market needs, or to non-traditional improvement situations such as R&D, strategic planning, new product and/or services development, advertising and promotions, acquisitions, and other knowledge-intense processes.

Technology and strategic improvement are integrated processes. In the new economy, technology is enabling the warp speed transformation of organizations into global, multi-level networks of transactional enterprises. Unlike manufacturing improvement, transactional improvement is transparent and comprised of key business processes, information flows, knowledge, and decisions. Further, there are literally hundreds of people managing thousands of dynamic process touch points, a continuous churn in requirements, specific country requirements, time constraints, communications issues, and exponentially greater opportunities to make bad decisions. Accordingly, technology has become much more important to the success of the next levels of Lean Six Sigma and strategic improvement in general. Technology is the integrated process architecture and critical enabler of improvement in this rapidly developing environment.

The recent meltdown has raised the bar on customer and market expectations in the global economy. Accordingly, there is a desperate need for organizations to get back on track with strategic improvement and evolve their ability and capacity to improve with better approaches. Improvement Excellence provides a new opportunity for organizations to build a solid and sustainable foundation of strategic improvement. Organizations that fail to recognize this urgent need to modify and realign improvement initiatives are doomed to failure. Further, organizations can no longer be successful in the new economy by continuing to follow the same antiquated and obsolete approaches to improvement of the past. For the past three decades, the world has changed while the process of improvement has remained fixed: the all too familiar top down, executive mandated, overhead intensive, single point, train-the masses approach… and a repackaging and relabeling of improvement tools, many of which have also existed for decades. This is precisely why the word continuous keeps falling out of continuous improvement. Improvement programs have come and gone with different buzzwords and a different look and feel, kind of like boxes with different ribbon wrapped around them. The ribbon changes, but the contents of the box remains basically the same. There is a fundamental rule of improvement that best describes this dilemma: Same people, plus the same thinking, plus the same process always equals same results.

Time to Move from Recovery to Discovery

The impulsive leadership actions to the 2008 meltdown are a natural response to disaster, leaving executives and organizations vulnerable to bad choices. The silver lining to the recovery is that there are more global opportunities for improvement and competitive success than any other time in history. It’s time to get serious with improvement, use what is already available to us effectively, inject creativity into the process of improvement, improve how we improve – and stay the course this time.

Organizations are now struggling with global challenges as we speak, that they never had to deal with in the past. What is next? In the new economy, organizations have entered a future where we will all need to evolve improvement and solve business problems at warp speed that we do not know about yet. Strategic improvement is not an option in the new economy. Today, organizations are either aggressively improving their businesses, or they are falling behind at an increasingly rapid rate.

Some organizations “get it” and are well into their new journey of Improvement Excellence, or improving how they improve, integrating technology with a well structured, targeted and scalable improvement process. People in these organizations are using real time data via portable technology, accelerated root cause thinking, and instant feedback as their daily routine of thinking and working. These organizations are in an offensive and proactive mode of improvement, and are rapidly leaving the competition in their dust. This is the future – the recognition and cultural acceptance of accelerated, technology-driven sustainable strategic improvement with unlimited possibilities, and unlimited competitive rewards for success.